RBC sees justification for Prothena rebound after study miss

RBC Capital keeps a Sector Perform rating on Prothena (PRTA) after the company’s partner Roche (RHHBY) presented topline data from the Phase IIb PADOVA study with prasinezumab in early-stage Parkinson’s disease and indicated that the study had missed on its primary endpoint. The firm says there were “promising signals of efficacy” among the overall population and a pre-specified analysis in patients on levodopa, which potentially provides a viable pathway for Roche to further develop the drug. With Prothena shares down considerably into the results and likely below fundamental risk-adjusted fair value, the signals of activity are “clearly keeping some hope alive for the program” that likely exceeded Street expectations and “justify some stock rebound” on this news, contends RBC. However, the firm points to the company’s limited royalties on the program and higher-risk upcoming data readouts for its neutral rating. The stock in midday trading is up 34%, or $4.05, to $16.00.